Influential agencies whose incompetence in economics is shown
most dramatically by the presently ongoing international
derivatives catastrophe, have insisted, until now, that the 1989-
1991 economic collapse of the Comecon and Soviet blocs proved
that the ideas of the British East India propagandist Adam Smith
had triumphed over the economic doctrines of Karl Marx.

Later, elections in various parts of the former Comecon bloc
reflected a fermenting hatred of the disastrous, so-called
liberal economic reforms introduced to those countries at the
insistence of former British Prime Minister Margaret Thatcher and
her confederate, then-U.S. President George Bush. Election-
trends there reflect the growing body of opinion within the
population: "Even communism was not as bad as this."

Recently, in both eastern Europe, including Russia most
significantly, and also in the former non-communist world
generally, there is a perception that both Adam Smith and Marx
are failures. In this setting, there is increasing attention to
sundry "third way" approaches to economic policy-shaping, "third
ways" which are either actual or only wishful alternatives to the
manifest lunacy of the Smith "free trade model." Among these
are certain delphic pretenses at reviving what was once known
world-wide as the only serious alternative to the British System,
the "American System of political-economy" of U.S. Treasury
Secretary Alexander Hamilton, Mathew Carey, the German-American
Friedrich List, the Americans Henry C. Carey and his student E.
Peshine Smith, Russia's Count Sergei Witte, et al.

Meanwhile, as I have forecast consistently during the past
three years, the growth of the global "derivatives bubble" has
brought the planet into an advanced phase of pre-collapse of
virtually all existing monetary and financial institutions. It
is important to stress, in that connection, that I have neither
"predicted" nor "prophesied" such a collapse; I am no Wall Street
tea-leaf reader, but rather a scientist. I have described in
functional terms the unfolding of the process of breakdown
leading into, and beyond the form of that systemic collapse of
that global monetary system which is currently in progress. It
is that description of the process which is uniquely vindicated,
in contract to the failed teachings of my so-called professional
competition.

Now, unless governments act soon to put the leading
monetary and financial institutions of the world into bankrupcy-
reorganization, we shall enter a far more devastating form of
breakdown-crisis, the virtual disintegration of existing monetary
institutions. Unless the correct choice of recovery program is
made, which is neither Adam Smith's, nor Karl Marx's, nor the
delphic parodies of an "American System," attempts at bankruptcy
reorganization will fail as tragically as the emergency reform in
Mexico is nearing disintegration at the present moment.

The following comparison of Smith with Marx, and of both
with the referenced delphic parodies, is made here with that
immediately practical consideration in view. It is essential to
issue a clear warning, that Smith (like his idiot-savant
follower, Professor John von Neumann) is even worse than Marx,
and that the ("scrupulously non-LaRouche") delphic parodies of
the "American System" are almost as incompetent as Marx's
doctrine.

Our procedure here is as follows.

First, we examine the notions of the two famous defenders of
"free trade," Adam Smith and Karl Marx, as varieties of the same
species of "Nostradamus economics." In that context, we identify
the single feature of Marx's four-volume Capital which shows
British economist Karl Marx as absolutely superior to that of all
of the British East India Company's Haileybury School, such as
Smith, Malthus, Ricardo, and John Stuart Mill, but otherwise
sharing all of the pseudo-scientific follies of those colleagues.

Second, after we have identified the common follies of all
these British economists, Marx included, we indicate why those
who parody the "American System," such as the Atlantic
Monthly's James Fallows, are guilty of the same fundamental
incompetence as Smith and Marx.

Finally, we summarize the crucial feature of the science of
physical economy, without which failure is guaranteed for any and
all efforts to prevent the world's early plunge into a
generations-long, planet-wide "new dark age."

Economic Science & Economic Pseudo-Science

Under the influence of the teaching-order known as the
Brotherhood of the Common Life and of the A.D. 1440 proceedings
of the Council of Florence, with the A.D. 1461 accession of Louis
XI as King of France, a new form of society was born. This new
form of society, the first modern nation-state, is what is known
as a "commonwealth." This broke the ancient oligarchical
tradition, under which more than ninety percent of the members of
society had been condemned to live, virtually or actually, as
serfs, slaves, or worse, with the small remainder of society a
pack of relatively privileged lackies doing the pleasure of
collective rule by self-styled virtual gods of Olympus, the
latter a relatively tiny aggregation of powerful oligarchical
families.

As typified by Louis XI's support for the educational
policies of the Brotherhood of the Common Life, the way was
opened, under policy of the state, for adolescent boys of poor
families to be educated in a manner which Friedrich Schiller's
writings and Wilhelm von Humboldt's later reforms defined as the
modern Classical-humanist method of education. Although the
steps taken during the twenty-odd years of Louis XI's reign were
but a beginning along the road to modern society, the increase of
the per capita wealth of France during his reign exemplify the
uplifting of the general condition of all strata of society under
his new policies.

The "commonwealth" as defined by Louis XI, and, later, by
France's Jean Bodin, is the form of society typified best by the
combined U.S. Declaration of Independence and 1787-1789 Federal
Constitution. It is a form of society to which all citizens are
dedicated constitutionally, a society to promote improvement in
the conditions of life of all citizens and their posterity. It
was an utter break with all axiomatic principles of feudalism and
barbarism earlier.

No competent study of economy can be made today, except in
the light of the continuing conflict between this new
"commonwealth" principle of Louis XI, and the forces, then and
still today, who represent the heritage of the bitter, feudal
oligarchical efforts to prevent and to destroy the perpetuation
of this new, anti-oligarchical form of society. The wars which
the patriots of the United States fought against the British
monarchy, and also againt anglophile traitors and scoundrels in
our midst, such as Presidents Pierce, Buchanan, Teddy Roosevelt,
Woodrow Wilson, Calvin Coolidge, and George Bush, are a prime
example of this continuing conflict, continuing as the war of the
British monarchy against a patriotic successor, Bill Clinton, to
U.S. Presidents William McKinley, Warren Harding, Franklin
Roosevelt, and John F. Kennedy.

The emergence of a modern economic science begins with the
writings of one George Gemmistos (Plethon) in fifteenth-century,
Golden Renaissance Italy. The development of economic pre-
science was advanced through the influence of Louis XI's
"commonwealth," and such sixteenth-century influentials as Thomas
Gresham in England and Jean Bodin in France. Out of these
developments, during the late sixteenth and seventeenth
centuries, there emerged a body of statecraft which came to be
known generically as cameralism, in which economy was studied
from the standpoint of the increase of national wealth, per
capita, per household, and per square kilometer of land
implicitly in use. The high-water-mark of achievement of
cameralism as such is the work of Cardinal Mazarin's protege and
successor, French Minister Jean-Baptiste Colbert.

This development of cameralism, through the achievements of
Colbert, was revolutionized, beginning 1671, by the work of
Gottfried Leibniz, who transformed economics into a branch of
physical science with his development of my specialty, the
science of physical economy. The best known aspect of
Leibniz's work in physical economy is his laying down the
principles for the eighteenth-century European industrial
revolution, through his development of the principles of heat-
powered machinery. It was Leibniz who fostered the design of the
first successfullly operating steam-engine, at the beginning of
the eighteenth century. It was Leibniz's science of physical
economy which influenced the economic policies of the young
United States, the policies which Treasury Secretary Hamilton
identified as "The American System of political-economy."

Then, came pseudo-economics; the seedlings of academia's
currently generally accepted economic dogmas, such as those of
Adam Smith, Jeremy Bentham, Karl Marx, and their successors, were
planted in France during the first half of the eighteenth
century, under the direction of an internationally very
influential Venetian abbott of that century, Antonio Conti. The
leading figure of this concoction of fake economic theory, called
the Physiocratic dogma, was Conti asset and founder of the dogma
of "free trade" --laissez faire-- Dr. Francois Quesnay. The
entirety of the British East India Company's Haileybury school
in political-economy, including Adam Smith, Jeremy Bentham,
Thomas Malthus, David Ricardo, James Mill, John Stuart Mill, and
so on, are all rooted in the dogmas of Quesnay et al. Marx, too.
Virtually everything taught as "economics" in universities today,
and virtually everything still accepted as "economics orthodoxy"
by most governments and other institutions, is a offshoot of this
same pseudo-scientific fustian.

Three Theories of "Surplus Value"

By the eighteenth century, modern European experience (i.e.,
since A.D. 1440) had established two facts beyond plausible
objection from the successes which the "commonwealth" revolution
had wrested, despite political set-backs, from the oligarchical
reaction: first, that the wealth of nations, per capita and per
square kilometer, had been increased in a manner exceeding all
earlier experience of barbarism and feudalism; and, second, that
this growth was rooted in the benefits derived from a margin of
produced surplus product, representing gains in output, relative
to the prior investment in the production yielding this enlarged
output.

Those who recall my 1966-1973 one-semester course on
"Dialectical Economics," should also remember more or less
vividly how I ridiculed, although justly, the three principal
varieties of metaphysical kookery devised by anti-commonwealth
doctrinaires to address this matter of marginal surplus. These
three are, in succession:

The Physiocrats attribution of "surplus" to a
biological epiphenomenon of the feudal ownership of
rural property. The adoption of the Physiocrat
Quesnay's dogma of "free trade" (laissez-faire).

The British East India Company's revision of the
Physiocratic dogma, to define "surplus" as an
epiphenomenon of Adam Smith's "Invisible Hand," an
epiphenomenon of merchants' truck and barter in opium,
slaves, and other items of "exchange value." Smith et
al. adopt the "free trade" dogma of Quesnay as a
central feature of their doctrine (although the pre-
1963 British Empire imposed "free trade" only upon its
victims, not upon itself).

"Materialist" Karl Marx's revision of the Physiocrats,
Smith, and Ricardo, to define "surplus" as a biological
epiphenomenon of the "horny hand of labor." Marx
defends the British East India Company's taught dogma
of "free trade" as the "scientific" basis for
capitalism.

Every variety of generally taught economics dogmas in virtually
all universities of the world today, is based upon either one of
these three varieties of superstition, or a dogma derived from
them.

The eighteenth-century French Physiocrats were a new
costuming adopted by that feudalist party which had been the core
of the Venice-led opposition to King Henri IV. This party had
been known as that seventeenth-century Fronde which had organized
civil wars in France against Cardinal Richelieu, against Cardinal
Mazarin, and Minister Colbert. It must not be assumed that these
Physiocrats meant that only agricultural and mining labor were
productive; for Quesnay et al., agricultural labor (e.g., serfs)
were no better than "talking cattle" with human form; it was the
land itself which yielded the surplus product, a product which
belonged, therefore, to those noble creatures to whom God had
alloted feudal ownership of the title to that land.

Like the Cecil party of Francis Bacon et al. in England, the
French feudalist opposition to Henri IV was under the direction
of Venice's Paolo Sarpi, and was closely allied to the House of
Orleans in France and to the English monarchy. This openly pro-
Venetian feudalist faction, including the House of Orleans
(through 1815) was, like Conti assets Montesquieu, Voltaire,
Quesnay, and Berlin's adopted Maupertuis, a key ally of London
during the reign of Louis XV, and a partner of British foreign
service's Jeremy Bentham in the deployment of the Jacobin Terror
of Robespierre, Danton, and Marat, later. The English/British
and French "Enlightenment" were direct outgrowths of the
influence of Sarpi, and Antonio Conti's salon was the leading
eighteenth-century continuation of Sarpi's influence in London,
Paris, and Frederick "the Great's" Berlin.

Unlike the French Physiocrats, the British East India
Company's ownership, whom Smith served as a mere lackey of Lord
Shelburne from no later than 1763 onward, were not typically
landed feudal aristocrats, but, rather, a Venetian-style
"Lombard" merchant-financier nobility, living on the proceeds of
usury from rent, trade and loans. This Venetian nobility had
taken over the Netherlands and British Isles in a manner
suggesting "body-snatchers from outer space." Hence, the British
East India Company revised the Physiocrat dogma slightly, to
relocate the epiphenomenon from the property-title of the feudal
aristocrat, to the persons of the London-style rentier nobility.
This adjustment was made without risking any improvement in the
condition of the human cattle, rural or urban.

In his turn, Marx, shifted the epiphenomenon from both
landowner and Lombard merchant, to the laboring class as a whole.
According to Marx, both the feudal and merchant parasite acquired
their possession of surplus by alienating it from the laborer, as
one "alienates" milk from a cow.

The distinctive feature of the influence of Sarpi, and such
followers as Antonio Conti, Giammaria Ortes, et al., is their
founding and promotion of a form of neo-Aristotelean doctrine
known as empiricism. This development was colored strongly by
Sarpi's pretensions and reputation as a mathematician. Sarpi was
the actual founder of the doctrine of mathematical causality
typified by Galileo Galilei, Rene Descartes, and Isaac Newton;
Galileo's famous treatises, including some of his fraudulently
claimed earlier discoveries, were extensions of the principles of
his mentor, Sarpi. Conti's salon is famous for the Europe-wide
apotheosis of a relatively obscure English practitioner of black
magic, Isaac Newton, as the "English Galileo," and the
introduction of the mechanistic algebraic methods of Sarpi,
Galileo, Descartes, and Newton to sundry aspects of social
theory. Sarpi is, in fact, the "natural" father of the English,
French, and German Enlightenments of the seventeenth and
eighteenth centuries.

Those economic doctrines of Quesnay, Giammaria Ortes, Adam
Smith, Jeremy Bentham, and Karl Marx which we have referenced
here, are prime examples of this introduction of "Newtonian
methods" to social theory.

Frederick Engel's Horny Thumb

The only aspect of Karl Marx's Capital which sets him
above his rivals of the British school of political-economy, is
his emphasis upon the process of social reproduction of "the
productive forces" of society as a whole. This, of course, is
not original to Marx, but it is unique within the British school
of which Marx's Capital is an outgrowth, the school which
provides the underlying basis for the type of economic doctrine
Marx represents. It appears, outside the British school, as the
hallmark of commonwealth economic thinking in general,
cameralism in particular, and, of course Leibniz and the
"American System" economists. Otherwise, Marx's doctrine was as
inane as those of the the rest of the British school and its
Physiocrat predecessor.

This combined British and Physiocrat school, including
Marx's Capital, is fairly and best described as the Venetian
school of Antonio Conti and Giammaria Ortes. This school has two
outstanding axiomatic features.

The the first such feature is its superstitious attribution
of social surplus to some epiphenomenal origin, such as the
Physiocrat's reliance upon ownership of land, per se, or the
rentier British East India Company's reliance upon the usury
extracted from truck, barter, and loans, or Marx's reliance upon
the epiphenomenal secretions of the "horny hand of labor." One
might say of Marxism: Frederick Engel's horny opposable thumb.

The second feature is the attempt to apply the "Newtonian"
algebraic methods of Sarpi's Galileo to social theory. E.g.,
that notion, as developed by the hoaxster Maupertuis and by
Giammaria Ortes, which Jeremy Bentham adopted as the method of
his "felicific," or "hedonistic calculus." This is the
"Newtonian" doctrine that one may impute the notion of "value" to
the implicit possibility of quantifying the relative intensity of
pleasure-pain a person may experience from contemplation or use
of each from among an array of sense-perceptual objects
presented. The radical extreme of this dogma is provided by the
systems analysis of the celebrated idiot-savant Professor John
von Neumann. In Marx, for example, this is implicitly the kernel
of the "labor theory of value" as introduced during the opening
several chapters of Capital I.

The implicit concurrence of Ortes, Bentham, Marx, John
Maynard Keynes, and John von Neumann on this account became the
basis for the Cambridge school of systems analysis of Mrs. Joan
Robinson, Lord Kaldor, Lord Solly Zuckermann, et al., which was
successfully introduced to Moscow, through the Laxenberg, Austria
International Institute for Applied Systems Analysis (IIASA), to
hasten the self-destruction of the Comecon economies.

Contrary to the epiphenomenal hogwash of Quesnay, Smith, and
Marx alike, before any of these persons had written, Gottfried
Leibniz had located the source of profit in scientific and
technological progress. In Leibniz's definition of the
industrial revolution he was designing, he focussed upon two
leading sources of the increase of the productive powers of
labor. First, the increase of the power per capita, as through
the use of the heat-powered machine (e.g., Denis Papin's steam
engine successfully used to power a river boat), by means of
which a person employing such a machine might do the work of "a
hundred others." Second, the increase of the productive powers
of labor through technology as such. Both qualities specified by
Leibniz appear, combined, by U.S. Treasury Secretary Alexander
Hamilton, in Hamilton's use of the notion of increase of the
"productive powers of labor" through investment in "artificial
labor." Underlying the epiphenomenal kookery of Quesnay, the
empiricists generally, Adam Smith, Immanuel Kant, and Karl Marx,
there is a common axiomatic assumption: that the creative powers
of reason do not exist.

In contrast to the sundry epiphenomalists, once we locate
increase in the productive powers of labor in those types of
changes in human behavior exemplified by scientific and
technological progress, the elementary principles of Leibniz's
science of physical economy appear. In summary, the argument is
of the following form.

Any fixed degree of advancement of a consistent mathematical
physics is approximated mathematically by a formal theorem-
lattice. Such a lattice is characterized by a single, underlying
set of axioms and postulates common to each and all of its
permitted theorems. A qualitative advance in technology
corresponds to an axiomatic revolution in the preceding form of
mathematical physics, a difference in the imputable set of axioms
and postulates, between the former and the latter. The manifest
increase of productive power of labor (per capita, per household,
and per square kilometer), of the latter over the former, thus
corresponds to the absolute formal discontinuity separating the
set of attributable axioms and postulates of the previous
mathematical physics from the set of the latter. This apparent
formal discontinuity is the formal-logical identification of the
efficient creative mental act responsible for the advance in
productive powers of labor.

It is that capacity which sets the human species absolutely
apart from and above the beasts.

Thus, in economic science (i.e., the science of physical
economy) "value" is essentially a notion associated with the
superiority of the mode of economy after such progress over the
prior state of affairs. The broader use of the term "value" is
limited to the notion of those "inputs" to the economy and its
households which are essential to bringing about a non-entropic
maintenance and increase of those productive powers of labor (per
capita, per household, and per square kilometer) for the society
as a whole.

This later process does not exist for Marx, or for the
Physiocrats, or for any other branch of the British school of
political-economy. Hence, all branches of today's generally
accepted economics dogmas are rooted axiomatically in the same
irrational superstition. Thus, in the final analysis, despite
the marginal superiority of Marx's Capital over today's
generally accepted brands of unievrsity economics teaching, all
varieties are as bad as, or worse than Marxism.

On the side of the Marxists, Frederick Engels carries this
reductionist superstition to the wilder extremes, with his absurd
babblings on the subject of "the opposable thumb." Either Engels
never made love to another one of the higher apes which H.R. H.
Prince Philip insists that both he and Engels are, or, if he did,
perhaps the lights were turned out. In the effort to evade the
economic significance of the work of scientists, Engels, arguing
like the most vulgarly anarchosyndicalist sort of trade-union
organizer, seeks to locate the root of technological progress as
an epiphenomenon of some mechanical sort of biological
characteristic of higher apes generally. Can one be surprised
that such opinions might prove to be ostensibly the epiphenomenal
outpourings of a British textile manufacturer whose profit and
pleasure were derived from the profits of U.S. slave-produced
cotton?

"Mixed Economy"

Senator Phil Gramm, whom Hollywood has exposed implicitly as
the fictional Forrest Gump's evil twin, is among those arguing
implicitly that the increases in standard of living formerly
achieved by modern Western civilization have been the result of
the kinds of British economics doctrine we have justly ridiculed
here. Is it fair to say that Gramm is not simply incompetent,
but also lying?

The fact has been, that, throughout the recent five
centuries, the actual national economies of Western European
civilization have been mixed economies. From the establishment
of modern France, in 1461, until the gradual replacement of
scientific and technological progress by "post-industrial"
utopianism, beginning about thirty years ago, all of Western
civilization was dominated by the unignorable advantage of
scientific and technological progress. Even the most hate-filled
enemies of progress, such as the Venetian nobility itself, dared
not ignore the military and other advantages of science and
technology. Nations whose oligarchies hated science were obliged
to employ it, lest they be overwhelmed by the technological
progress of their rivals. Even those oligarchical states, such
as Britain, which would have preferred to degrade at least eighty
percent of their own population to the serf-like condition of
illiterate human cattle, were terrified repeatedly by the
prospect that their French, German, and American rivals were more
advanced than the British Isles.

The struggle between the oligarchical whim to crush
scientific and technological progress, and the fear of the result
should one not match the progress of one's rivals, has been the
setting in which various forms of "mixed economy," both
technologically progressive and anti-scientific oligarchical
forms, have dominated every part of the world, until about thirty
years ago.

The recent decades' change appeared in the aftermath of the
Cuba "missiles crisis."

From the beginning of the twentieth century, Bertrand
Russell had been committed to the elimination of the modern
nation-state, to make way for a world government, such as the
United Nations Organization. His objective was to ensure the
perpetual rule of this planet by a the Venetian-style British
oligarchy of which he, like his grandfather, was a
representative. By the repeated testimony of his own writings of
the early 1920s and later, Russell was a racist and mass-
murderer, intent on wiping out vast numbers of Africans, Muslims,
Hindus, Chinese and others. Russell was also the leading
architect of the policy of using weapons so terrifying that no
nation would be willing to risk war in its own defense, and would
therefore submit to the whims of world government; he was the
leading author of the nuclear-weapons age which began with the
militarily needless dropping of nuclear bombs on Hiroshima and
Nagasaki in August 1945 (contrary to the popularized lie, not a
single U.S. life was saved by dropping those bombs).

Russell set forth his post-war nuclear-weapons policy once
more in the September 1946 edition of The Bulletin of the Atomic
Scientists, in which he first called for preparing for a
"preventive nuclear attack" on Russia for the purpose of
establishing the United Nations Organization as a world
government to replace the governments of every nation, including
the United States.

In 1955, N. Khrushchev sent emissaries to Bertrand Russell
in London, to proffer acceptance of Russell's proposal for peace
through mutual nuclear terror. Russell's policy of "mutual and
assured nuclear annihilation" was adopted on the initiative of
Russell's stooge, Leo Szilard, at the Second Pugwash Conference
at Quebec, in 1958. Khrushchev's dalliance with the West on this
deal blew up, temporarily, between the time of the U-2 incident
and the 1962 "Cuba missiles crisis." 1962-1963 negotiations
between the U.S.A. and Moscow, mediated by Russell in London,
reestablished the Russell-Szilard-Kissinger-McNamara doctrine of
"mutual and assured nuclear destruction" as the basis for
relations between the nuclear super-powers.

During 1963, this post-Missiles-Crisis agreement to the
Pugwash Conference doctrine of "Mutual and Assured Destruction"
was sealed in the blood of the murdered President John F.
Kennedy. In the wake of Kennedy's assassination, the Anglo-
American anglophile establishment, represented by such public
figures as National Security Advisor McGeorge Bundy and Secretary
of Defense Robert S. "Body Count" McNamara, were confident that
the age of general warfare had ended, that only limited wars,
managed by diplomats, such as Bundy's, and, later, "Pugwashee"
Kissinger's "surrogate war" in Indo-China, were possible. The
results of that "pugwashed" thinking are typified by the 1964
publication of the Russellite The Triple Revolution by Robert
Hutchin's Ford Foundation-funded Fund for the Republic, by the
mass recruitment of university-based "baby boomers" to the rock-
drug-sex counterculture and "post-industrial society," the
emergence of the "science-fiction" kookery of Zbigniew
Brzezinski's 1967 announcement of that "technetronic age" which
Alvin Toffler terms the "Third Wave," H.R.H. Prince Philip's
pagan nature-worship in the name of ecology, and military video-
game entertainments (with real corpses) such as "Air Land Battle
2000."

The case of two Executive Orders highlights the connection.
Not long after President Kennedy's assassination by forces linked
to British intelligence's Permindex assassination organization,
the same National Security Advisor, McGeorge Bundy, who played a
key part in closing off the investigation of the assassination,
induced President Lyndon B. Johnson to sign an Executive Order
revoking President Kennedy's earlier Order to McNamara to phase
down the U.S. invovement in a Vietnam conflict. Once Bundy saw
President Johnson boxed into that decision to escalate the war in
Vietnam, Bundy left government, to play a key role in funding
the anti-war movement and other "Clockwork Orange"-style social-
work projects, from his new ensconcement at the Ford Foundation.
The target of the U.S. involvement in the Vietnam "Clockwork
Orange" war was not some Communist adversary; it was the minds of
the people of the United States. The first target was that
strata of "Baby Boomers" --the prospective future intelligentsia
of the United States-- then of draftable age, on university
campuses.

Those among us teaching on key U.S. university campuses
during the 1966-1973 interval saw, first hand, the relevant
effect of the induced terror of the nightly broadcast TV special,
known as "The War in Vietnam." This televised spectacular, "The
O.J. Simpson Trial of the 1960s," reduced the majority of that
social stratum on campus to a state of existentialist panic; it
was under these conditions, that the rock-drug-sex
counterculture, as orchestrated by degenerates such as Dame
Margaret Mead of the Josiah Macy., Jr. Foundation and New York
Museum of Natural History, was introduced, as a London Tavistock
Institute-style cultural-paradigm shift, into the majority of
that campus stratum.

The New Ager's scenario of 1965-1972 had the following
crucial elements. "Are you a suburbanite Baby Boomer of draftable
age sitting on campus today? Nightly TV images of the
corpse-which-might-be-you making a mess of your head? Try sex as
diversion. With whom? With anyone, anywhere, anytime--with any
thing. Still getting those images? Drop a little acid;
marijuana works better with a a bottle of cheap wine to slosh it
down. Not good enough? Ever try pounding your head, again and
again, against the end of the crib? Try an all-night rock
session."

Decades later, the echoes of 1965-1972 are still producing
psychological carnage. "Still getting bad vibrations, even after
all these years? Try a ride on the mid-life-crisis roller-
coaster. Come to live in virtual reality, and get away from the
reality you lack the courage to face."

The result of that "cultural paradigm-shift" launched
thirty-odd years ago, has been several decades transition from
the United States as an agro-industrial power typified by the
1950s and 1960s image of a modern farmer, scientist, and
engineer, to the image of New York City's festering, Clockwork-
Orange decay under the rule of mathematical-logic fanatics, who
are virtually incapable of changing a light-bulb in real life,
who win wars, and make trillions of dollars in electronic play-
money, while destroying the world, all in the virtual reality of
video-games and financial-market speculation in junk bonds and
other derivatives.

This latter result is the consequence of eliminating one of
the two legs of the form of "mixed economy" which Western
civilization (in particular) represented during the centuries
preceding 1964. The science and technology leg, its correlated
educational feature, and the war-time Bretton Woods agreements on
monetary stability, were each and all virtually eliminated over
the interval 1964-1972. Despite the liars who argue the contrary
in fraudulent reports issued from certain governmental and other
institutions, the physical economy of the United States has been
collapsed greatly during the interval 1967-1995. The medium-
range steel worker of 1967-1969 who could still support a family
has vanished, replaced by the virtually useless hamburger-flipper
with a sub-living wage. Economy is withering; what is increasing
is poverty, decay, gambling, drug-pushing, mugging, murder,
financial speculation, illiteracy, bad taste, decadence
generally, and the indices of the financial markets. Some
lunatics see signs of economic growth in the fact that financial
aggregates -- prices and indebtedness -- are way, way up.

In former times, before the calamitous "cultural paradigm-
shift" of 1964-1972, the value of the U.S. economy (in
particular) was the net result of the pluses in real economy
(agriculture, basic economic infrastructure, manufacturing, and
quality health-care and education), combined with the minuses of
parasitism (gambling, crime, speculation, Hollywood, Sigmund
Freud's pernicious influence, and so on). As long as
agricultural and industrial output per capita were increasing, as
long as power per capita, education per capita, infrastructural
improvements per square kilometer, and scientific investment were
increasing, these useful aspects of our national economy gave
substance to the economy as a whole.

Now, the healthy side of our mixed economy has been
systematically gutted; much bone, in addition to flesh, is
already gone. Yet, the price of the total, mixed economy has
been greatly increased in the form of the great debt-bubble
centered around the derivatives speculation of the "free trade"
sector. The monetary overvaluation of the total economy has
become an unsustainable financial bubble, which must be either
deflated soon, or it will pop. In any case, as long as the world
continues to attempt, futilely, to meet payments obligations to
the financial bubble, the world is doomed; either bankrupt the
bubble, or civilization at large can not survive.

The time has come, that the only certain chance of any of us
reaching the year 1997 in a civilized condition, is that someone
in authority throwing the existing international monetary and
financial institutions into government-directed bankruptcy-
reorganization. The institutions to be taken over so include the
Chairman Greenspan's U.S. Federal Reserve System, which, if all
assets and liabilities are taken into account together, is
already bankrupt. A successful bankruptcy signifies that we have
a plan of economic reorganization, to turn a bankrupt U.S.A.
economy into a prosperous one, again. The essence of that answer
to that challenge is that we do have a fully workable, provable
plan available for that purpose. The plan, in short, is to
return to the policies of Treasury Secretary Hamilton, and
bankrupt, out of existence, the modern remains of the
oligarchical rentier tradition. The success of such a revival of
the American System depends upon a general system of education
which fosters the scientific progress indispensbale for restoring
the economy to health once again. The question is, who has the
brains, guts, and position of authority to take the lead in doing
just that.

The preceding article is a rough version of the article that appeared in
The American Almanac. It is made available here with the permission of The New
Federalist Newspaper. Any use of, or quotations from, this article must attribute them to The
New Federalist, and The American Almanac.